Abercrombie & Fitch 1999 Annual Report Download - page 6

1110
Abercrombie &Fitch Co.
CHAIRMAN’S LETTER
It’s been amazing to see Abercrombie & Fitch grow from a small upstart in 1992 to its current
position among the retail industry leaders. Each phase of growth has presented unique chal-
lenges—our current position is no different. We passed a billion dollars in sales in ‘99, our EPS
increased 45%, and our operating profit reached 23.2% of sales, probably the highest in the
industry. We opened 54 new stores and a band wrote a hit song about girls who wear A&F.
After so much continuous success, how do we keep the momentum going? We understand
that the retail industry and the 18-22 year-old market we target are fickle. Fads, trends and hit
songs come and go. That’s why in 2000 A&F is being managed to avoid the over-exposure and
overload that can lead to brand saturation. The A&F label is our most critical asset and must be
managed for long-term, sustainable growth. If we stay real and work to be innovative, the
Abercrombie brand will continue to provide stability, opportunity, growth and profits.
I’m convinced that the authenticity of the Abercrombie brand has enabled our growth and
success—to our customers the brand continues to be relevant and aspirational. A&FTV is our
new internet-only program and a good example of our focus on innovative, relevant marketing.
The program is hosted by kids who work in our stores and features anything and everything that
relates to college living.
But brands cannot expect long term success from marketing alone, which is why we continue to
focus our attention on the basics of running a retail business. Producing the absolute highest qual-
ity goods defines much of who we are. We are also working to ensure that the quality our consumers
find in our clothing carries into the experiences they have in our stores, with our catalogs and mag-
azine and online. In short, we want to make sure our customers are happy with A&F on every level.
In spite of our tremendous and rapid success, I feel strongly that Abercrombie & Fitch has
unbelievable growth potential—the core A&F brand is a dynamic, growth business and will con-
tinue to be hugely profitable. abercrombie, our kid’s business, is still in its relative infancy and is
primed for steady expansion. New concepts like the one we will launch this summer will fuel the
company’s already explosive growth opportunities. These opportunities combined with our focus
on the basics of running a smart retail business will ensure continued success in 2000 and beyond.
Michael S. Jeffries
Chairman and Chief Executive Officer
Abercrombie &Fitch Co.